Which Is Not a Source of Information That Would Be

question 24

Multiple Choice

Which is not a source of information that would be used as an indicator of impairment?

• A)Adverse changes in the technological competitive or legal environment of the entity.
• B)Market value of asset has increased more than would be expected from normal aging.
• C)Market value of asset has decreased more than would be expected from normal aging.
• D)The market value of the entity as a whole is less than the carrying value of its net assets.

---

Definitions:

Opportunity Cost

is the value of the best alternative that is forgone in making any choice or decision, representing the benefits an individual, investor, or business misses out on when choosing one alternative over another.

Explicit Cost

The direct, out-of-pocket expenses incurred by a company or individual, contrasting with implicit costs which represent opportunity costs.

Sunk Costs

Expenses that have already been incurred and cannot be recovered, which should not affect future financial decisions.

Production Costs

The total expenses incurred in the process of producing goods or services, including raw materials, labor, and overhead.